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Jonathan Tobin: Defending the Right to a Jewish State

Heather Hale: Compliment your kids without giving them big heads

Megan Shauri: 10 ways you are ruining your own happiness

Carolyn Bigda: 8 Best Dividend Stocks for 2015

Kiplinger's Personal Finance editors: 7 Things You Didn't Know About Paying Off Student Loans

Samantha Olson: The Crucial Mistake 55% Of Parents Are Making At Their Baby's Bedtime

Densie Well, Ph.D., R.D. Open your eyes to yellow vegetables

The Kosher Gourmet by Megan Gordon With its colorful cache of purples and oranges and reds, COLLARD GREEN SLAW is a marvelous mood booster --- not to mention just downright delish
April 18, 2014

Rabbi Yonason Goldson: Clarifying one of the greatest philosophical conundrums in theology

Caroline B. Glick: The disappearance of US will

Megan Wallgren: 10 things I've learned from my teenagers

Lizette Borreli: Green Tea Boosts Brain Power, May Help Treat Dementia

John Ericson: Trying hard to be 'positive' but never succeeding? Blame Your Brain

The Kosher Gourmet by Julie Rothman Almondy, flourless torta del re (Italian king's cake), has royal roots, is simple to make, . . . but devour it because it's simply delicious

April 14, 2014

Rabbi Dr Naftali Brawer: Passover frees us from the tyranny of time

Greg Crosby: Passing Over Religion

Eric Schulzke: First degree: How America really recovered from a murder epidemic

Georgia Lee: When love is not enough: Teaching your kids about the realities of adult relationships

Cameron Huddleston: Freebies for Your Lawn and Garden

Gordon Pape: How you can tell if your financial adviser is setting you up for potential ruin

Dana Dovey: Up to 500,000 people die each year from hepatitis C-related liver disease. New Treatment Has Over 90% Success Rate

Justin Caba: Eating Watermelon Can Help Control High Blood Pressure

The Kosher Gourmet by Joshua E. London and Lou Marmon Don't dare pass over these Pesach picks for Manischewitz!

April 11, 2014

Rabbi Hillel Goldberg: Silence is much more than golden

Caroline B. Glick: Forgetting freedom at Passover

Susan Swann: How to value a child for who he is, not just what he does

Cameron Huddleston: 7 Financial Tasks You Should Tackle Right Now

Sandra Block and Lisa Gerstner: How to Profit From Your Passion

Susan Scutti: A Simple Blood Test Might Soon Diagnose Cancer

Chris Weller: Have A Slow Metabolism? Let Science Speed It Up For You

The Kosher Gourmet by Diane Rossen Worthington Whitefish Terrine: A French take on gefilte fish

April 9, 2014

Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?

Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Kim Giles: Asking for help is not weakness

Kathy Kristof and Barbara Hoch Marcus: 7 Great Growth Israeli Stocks

Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease

Sabrina Bachai: 5 At-Home Treatments For Headaches

The Kosher Gourmet by Daniel Neman Have yourself a matzo ball: The secrets bubby never told you and recipes she could have never imagined

April 8, 2014

Lori Nawyn: At Your Wit's End and Back: Finding Peace

Susan B. Garland and Rachel L. Sheedy: Strategies Married Couples Can Use to Boost Benefits

David Muhlbaum: Smart Tax Deductions Non-Itemizers Can Claim

Jill Weisenberger, M.S., R.D.N., C.D.E : Before You Lose Your Mental Edge

Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease

Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear

The Kosher Gourmet by Marlene Parrish A gift of hazelnuts keeps giving --- for a variety of nutty recipes: Entree, side, soup, dessert

April 4, 2014

Rabbi David Gutterman: The Word for Nothing Means Everything

Charles Krauthammer: Kerry's folly, Chapter 3

Amy Peterson: A life of love: How to build lasting relationships with your children

John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet

John Ericson: Why 50 million Americans will still have spring allergies after taking meds

Cameron Huddleston: Best and Worst Buys of April 2014

Stacy Rapacon: Great Mutual Funds for Young Investors

Sarah Boesveld: Teacher keeps promise to mail thousands of former students letters written by their past selves

The Kosher Gourmet by Sharon Thompson Anyone can make a salad, you say. But can they make a great salad? (SECRETS, TESTED TECHNIQUES + 4 RECIPES, INCLUDING DRESSINGS)

April 2, 2014

Paul Greenberg: Death and joy in the spring

Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?

Mayra Bitsko: Save me! An alien took over my child's personality

Frank Clayton: Get happy: 20 scientifically proven happiness activities

Susan Scutti: It's Genetic! Obesity and the 'Carb Breakdown' Gene

Lecia Bushak: Why Hand Sanitizer May Actually Harm Your Health

Stacy Rapacon: Great Funds You Can Own for $500 or Less

Cameron Huddleston: 7 Ways to Save on Home Decor

The Kosher Gourmet by Steve Petusevsky Exploring ingredients as edible-stuffed containers (TWO RECIPES + TIPS & TECHINQUES)

Jewish World Review

The Morality of Bankruptcy, Part I

By Rabbi Dr. Asher Meir





http://www.JewishWorldReview.com | Q. My job involves advising people on their financial affairs. Is it ever proper to advise someone to declare bankruptcy and avoid paying his debts?


A. Everyone has to pay their debts but not everyone can, so the question arises what to do when a borrower is insolvent. One of the solutions is bankruptcy, which involves formal legal protection of the borrower against certain collection actions.

The modern concept of bankruptcy began as a procedure for the benefit of creditors. When a person or business becomes insolvent, creditors may race to be the first to collect. This is both wasteful and unfair. It is wasteful because the creditors are investing effort and money to be first but the total amount collected is not augmented by this effort and indeed is usually diminished because assets may be sold in a hurry at discount prices. It can be unfair because the one who actually gets the money may not be the most worthy – the first, the largest, etc. So a creditor can request a bankruptcy proceeding which will halt all debt payments and arrange for an orderly, efficient and fair liquidation. This process can also benefit the debtor, as he is part of an orderly process instead of a frantic raid. In addition, it may be in the benefit of all parties to keep the debtor free and working and bankruptcy facilitates this option.

Later on legislators began to turn their attention to the welfare of the debtor as well as the creditor. In the US we find that there were occasional debt amnesties, but eventually this was institutionalized in legislation allowing debtors a "fresh start" under some circumstances.

This set the pattern that persists until today, with two different kinds of debt relief: graduated payment plans to protect the borrower from collection as he pays his debts over an extended period, or a discharge that completely erases debts and enables the debtor to start anew.

Both of these procedures have precedents in Judaism, but in Jewish tradition the orientation considered foremost the well-being of the debtor. In this column we will mention a number of Torah commandments that protect the debtor from excessively harsh collection actions. Next week we will continue and see how these Torah principles were applied, and what kind of balance was struck by later Jewish sages between the interests of debtors and creditors.

The following verse states that if the debtor is unable to pay, it is forbidden to dun him merely to harass him. (All translations are from "The Living Torah".)

    When you lend money to My people, to the poor man among you, do not press him for repayment. [Also] do not take interest from him. (Exodus 22:24)

The subsequent verses relate to a pledge or pawn. This was the dominant form of lending in the time of the Torah, but the Torah ensures that this is used only as it is needed as a security for the loan, and not as a way of creating hardship for the borrower as a way of pressuring him:

    If you take your neighbor's garment as security [for a loan], you must return it to him before sunset. This alone is his covering, the garment for his skin. With what shall he sleep? Therefore, if he cries out to Me, I will listen, for I am compassionate. (Exodus 22:25-26)

The same idea is found in Deuteronomy 24:12-13.

Likewise, a pledge should not be counterproductive and prevent the borrower from making a livelihood. As we see, this Torah principle serves as the main basis for making a humane payment arrangement:

    Do not take an upper or lower millstone as security for a loan, since that is like taking a life as security. (Deuteronomy 24:6)

Another principle is that the right to repayment or a loan security is legitimate, but may not serve as a lever to violate the borrower's dignity or privacy:

    When you make any kind of loan to your neighbor, do not go into his house to take something as security. You must stand outside, and the man who has the debt to you shall bring the security outside to you. (Deuteronomy 24:10-11)

Alongside these individual admonishments, there is a nation-wide command to have a general release at the end of every seven years, when all debts are released and all obtain a fresh start:

    At the end of every seven years, you shall celebrate the remission year. The idea of the remission year is that every creditor shall remit any debt owed by his neighbor and brother when God's remission year comes around. (Deuteronomy 15:1-2)

These are the basic principles. Next week we will see their application and development, and see when bankruptcy can be considered a legitimate and ethical step.

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JWR contributor Rabbi Dr. Asher Meir, formerly of the Council of Economic Advisers in the Reagan administration, is Research Director of the Business Ethics Center of Jerusalem, Jerusalem College of Technology.

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